Stocks decline as General Electric slumps to a 5-year low

Stocks fell Tuesday as shares of General Electric slumped for a second straight day.

GE stock fell 5.5 percent to its lowest level since June 2012 and has fallen more than 10 percent over the past two days. The company unveiled a massive restructuring plan and slashed its dividend by 50 percent at an investor meeting.

CEO John Flannery told CNBC’s “Squawk on the Street” he was not surprised by the investor reaction to sell the stock, noting the company disappointed investors.

Analysts across Wall Street remained “unsettled” by what they heard as GE’s turnaround plan disappointed them.

Equities had already kicked off Tuesday’s session on a sour note, as disappointing economic data out of China raised concern about the global economy.

The Dow was down 55 points. The S&P 500 declined 0.25 percent, with materials as the biggest declining sector. The Nasdaq also pulled back 0.25 percent.

This reaction is “not that strange given we’re near all-time highs,” said Art Hogan, chief market strategist at Wunderlich Securities. “We’ve got global synchronized economic growth and China is a very important part of that. If there’s a slowdown there, that would spill over into global markets.”

The Chinese 10-year yield hit its highest level in three years and copper prices fell following the data releases.

“China’s economy will inevitably slow further if we actually see slower credit growth and now we have rising interest rates,” Peter Boockvar, chief market analyst at The Lindsey Group, said in a note.

Investors also grew worried about the whether Republican lawmakers would pass a tax plan by year-end. Last week, the Senate unveiled a tax bill that would delay cutting the corporate tax rate to 20 percent until 2019. The current U.S. corporate tax rate is 35 percent. The House, meanwhile, wants to vote on its own tax bill this week. The House bill would immediately reduce the corporate rate.

“While both House and Senate tax bills have much in common, several key differences exist that

will need to be worked out,” L. Thomas Block, head of research at Fundstrat Global Advisors, said in a note. Potential obstacles to reaching a compromise between lawmakers include “rebellions by high tax state Republicans or conservative deficit hawks, mortgage interest deductions, treatment of “pass-through” income for small businesses, and the future of the estate tax,” he said.

Wall Street also paid attention to the retail space, as several companies in the industry reported quarterly results on Tuesday.

TJX Companies, the parent company of TJ Maxx, posted earnings per share that were in line with expectations, while revenue missed. But the company’s stock fell after its same-store sales for the quarter remained flat. Analysts polled by Reuters expected a gain of 2.3 percent.

In economic news, the U.S. producer price index rose 0.4 percent in October. Economists polled by Reuters expected an increase of 0.1 percent.

“The PPI data exceeded expectations across the board as wholesale prices continue to adhere to its uptrend that began in early 2016. This inflationary pressure has yet to spill over to Main Street,” said Jeremy Klein, chief market strategist at FBN Securities, in a note.